Women, Wisdom, & Wealth: Tee up your investments

what investors learn from golf

DARCIE GUERIN

10:19 PM, Jul 28, 2009

There's a mystique around golf that I have find intriguing. Not a golfer myself, I've never had a burning desire to chase the little white ball, and since no one that I spend a great deal of time with is a golfer, I've only golfed once in my life.

I've always been curious as to what the attraction is especially since there are so many of my colleagues in the investment industry who live for golf. It does appear that there the common denominator for successful golfers and successful investor is the mastery of strategic thinking, proper perspective and patience.

Golf is both fascinating and frustrating, just like investing is for some people. There are many parallels between the two endeavors. The demands placed upon the pros in either field require rigorous concentration. The successful investor and the professional golfer possess similar attributes and traits.

One thing that golf teaches you is humility.

"The Natural" and "Field of Dreams" are classic baseball movies that provide life lessons as well as the history of the game. Golfers can enjoy similar multi-layer meaning entertainment while watching "The Greatest Game Ever." This 2005 Hollywood story introduces us to a 20-year-old amateur named Francis Ouimet, who with the help of his 10-year-old caddie, Eddie Lowery, helped put golf on the U.S. sporting map. The story dramatizes Ouimet outshooting the great British golfers Harry Vardon and Ted Ray in an 18-hole playoff. Some golf writers pick the 1913 U.S. Open as depicted in the movies as the most riveting major ever.

Both men were destined for success in later life, Ouimet as a businessman and stockbroker for Brown Brothers Harriman in Boston, Lowery as a multimillionaire California automobile dealer. Both gave back much to the game of golf, and both seem to have applied the principles of the game to real life.

Watching as the drama unfolded over the recent 2009 U.S. Open a few weeks ago, you probably didn't give much thought to finances and your portfolio. Watching the players assess the slope of the hilltop green at the 470-yard 15th, I did try to figure out how they might possibly set up for their second shot and started thinking for a moment about the preparation that goes into trying to negotiate a tough course like this. Just like on a ski slope that is designated as a black diamond trail, there's even an intimidating warning on the first tee cautioning that Bethpage Black "is an extremely difficult course" and should be attempted only by "highly skilled golfers." We've seen more than our fair share of Black Diamond investments in the recent past.

I would imagine that professional golfers' heads are filled with the same thoughts as other competitive men and women. The winning strategies and well-conceived game plans are well thought out, studied from many angles and allow for contingency plans. Flexibility and options are always useful.

Golfers know that emotions are the enemy, that their best judgments must come into play when it's time to decide to be conservative or aggressive on the course — that no matter how perfectly the ball is struck, risks abound. Golf, after all, is another game of inches — the ball drops into the cup or slides on past; it settles into sloping grass at the top edge of the green or rolls into the water. There is wind. Or not. There are no guarantees, and everything depends on the execution. It's not a coincidence that this sounds something like investing.

If you are a golfer, I'm not foolish enough to image that you were thinking about your portfolio, whether you had a ticket to walk the course and patrol the ropes at Bethpage Black or were simply sitting in front of the TV. I just like to draw some parallels between the game that so many enjoy and the principles that lie behind successful investing. When I'm ready to head for the greens again it may be a wise idea to take a lesson, or two or three from the pros.